It is always a good idea to compare lenders rates as the lender your dealer typically uses may have higher fees or rates. When we were shopping, we found lenders that were lower than our dealer by 1% or more. This can make a big deal over the life of the loan especially if it is on the long side. In good faith, you can always ask your RV dealer to match the loan to give them the business, but if they can’t, try and save money where you can. Always remember, auto loans are easy to refinance, so if rates go down, you can always refinance very quickly.
In addition to your trailer purchase, you will have to pay annual registration fees. Typically these may range from $100-130, or may vary depending on your state. Licensing your vehicle will give you plates so you ar legal to drive on the roads. Some registrations may give you the option to buy a parking pass to your states parks. This may be a good idea. For our state, the option is $40 additional dollars per year pawn shops Vermont. But each time we go to a state park it costs $7 to get in. So this $40 at time of license saves us after 5 times we go in.
Your new travel trailer will require insurance. For our 21′ unit, we pay $430 per year or about $35 monthly. This seems to be a fairly cheap number for the piece of mind of full coverage. Always check with your insurance companies for the best rate and play around with different coverages. We found that we could add coverage for other items and our liability for only a couple of bucks more per month. It’s worth the extra time to get the right rate for you.
To sum up this article, we have given you some examples of different payment terms. What you pay for your travel trailer, interest, and term are the largest factors on your RV monthly payment. When you are shopping, you will find your sweet spot for your budget with the cost as well as term, and your interest rate will be determined based on what bank you use and what current market rates are. We hope you enjoy the process when you are purchasing a trailer, it is a difficult and stressful time so make sure to take a deep breath and have fun!
These monthly prices may seem a bit high, but we have an article that describes how you can help offset some of your RV purchase price by renting it out to others, or even get it paid for.
Typically, RV loans range from 4-15 years. As your RV purchase gets more expensive, you can choose a longer term to lower your monthly payment. If you are financing a large RV typically over 50,000 some banks will lend up to 20 years.
Under current regulations, a RV is deductible as it can be qualified as a second home. The interest is what you could save by deducting from your taxes, but typically this will just reduce your expenses, but the interest you pay to the bank will still be more.
For a loan under $25,000 terms we have found popular term ranges from 48-144 months or 4-12 years. The term can drastically change a payment amount, for example, if you finance $25,000 over 4 years at 5%, you would pay $575 per month. Under those same parameters, a 12 year loan would result in a $231 monthly payment. The kicker is that over the 4 year loan you would pay $2,635 in total interest whereas over the 12 year loan you would pay $8,296.